Banks considered too big to fail should aim for a ratio of
capital to assets of at least 4 percent, exceeding the 3 percent
threshold proposed by the Basel Committee on Banking Supervision
for 2018, Dijsselbloem said in a letter to the Dutch parliament
published on the government’s website today.

The Netherlands will seek permission for governments to
apply the rules nationally should they fail to agree on the
common framework, Dijsselbloem said. “Further steps are needed
to make the banking industry more solid and stable to ensure it
can perform its role in the economy adequately,” he said.

The focus on leverage is the latest effort by financial
watchdogs to prevent a repeat of the taxpayer-funded bank
rescues of 2008. Regulators are facing resistance from lenders
including Deutsche Bank AG and Societe Generale SA, who have
issued stock, sold units or hoarded earnings to increase a
different measure of financial strength known as the Basel III
Tier 1 capital ratio which allows banks to weight their assets
according to risk.

The leverage ratio for the biggest U.S. lenders would rise
to 5 percent for parent companies and 6 percent for their
banking units under a proposal by regulators in July. EU laws
currently require banks to report how they measure up in terms
of the 3 percent Basel ratio from 2015.

Dutch Leverage

The leverage ratio of the Dutch banking industry, excluding
off-balance sheet exposures that would have to be taken into
account under Basel rules, has risen to almost 4 percent,
Dijsselbloem said.

ING, the biggest Dutch financial-services company, said
this month that its leverage ratio, defined as Basel III Tier 1
capital divided by total balance sheet exposure, including off
balance sheet holdings, was 3.9 percent at the end of June. SNS,
which was nationalized in February, said its ratio, excluding a
property finance unit that will be split off, was 2.8 percent at
the end of June.